Cuz there ain't enuf places to get coffee

[Kevy Baby]

Just as I was starting to get worried that there were too few places that I could get a latte, McDonalds has come to the rescue:

McDonald’s coffee bars to take on Starbucks
Fast-food giant plans to serve up lattes at all U.S. outlets, newspaper says

McDonald’s Corp’s plan to expand the beverage lineup at its U.S. restaurants with cappuccinos, lattes and other drinks is expected to add $1 billion to annual sales, a spokeswoman said on Monday.Read the rest of this life-saving story here (http://www.msnbc.msn.com/id/22536076/). I can sleep easier now.

[JWBear]

Thus comes Armageddon.....

[katiesue]

The McDonalds near my office has had this on the menu for a couple of years - it must have been a test store. I've never had any though. I just drink black coffee - none of the fancy schmancy stuff anyway.

[blueerica]

A case study I was working on about a year and a half ago discussed McD's plans to branch into this area, to compete with Starbucks. It's been tit-for-tat for both parties, with Starbucks' breakfast sandwiches and McD's big play on how their coffee wins out taste tests against Starbucks. McD's regular stores have slowly been undergoing remodels, to reflect this change as well: muted colors, more chrome, better lighting, seating not meant to make people grab their food and go.

McD's numbers (though large) have been in a slump, if I remember correctly, and they're hoping to capture the gourmet coffee-shop trend. This will probably be more successful in other areas of the country, I surmise, since the trend has been played for about two decades in more metropolitan areas, such as southern and northern California, etc, etc, etc. It could, I suppose, play better for tourists, looking for the familiar arches.

[Ghoulish Delight]

McD's numbers (though large) have been in a slump...It's still a significant change, but I always like to point out that the "slump" consists a drop in profits, not an actual net loss. In today's stock-price-driven economy, it's huge news for a company that had been steadily growing for as long as McDonald's had been, but it still bugs me when I see it reported as "McDonald's loses money!"

[BarTopDancer]

It sounds like they are going to have automatic espresso machines. Push the button and you get a fancy drink. I almost hope they do - can you imagine McDonald's workers making a double shot soy mocha?

[Morrigoon]

I can't see myself becoming a McDonald's coffee devotee.

I pay $4 for my coffee, and $3.50 for my Big Mac.... I expect damn good coffee, if you KWIM. If they try to serve me a Big Mac latte, they'd better have a price point under $2.

[Alex]

Just so long as the place doesn't end up smelling as vile as Starbucks/Peets/etc.

[Stan4dSteph]

I actually love the McCafés in New Zealand. The one I go to near my sister's place has a separate counter and a little Starbucks-like seating area. They also have more interesting food choices than the usual McDs offerings. I like the chicken satay wrap.

[Kevy Baby]

McD's numbers (though large) have been in a slump, if I remember correctly...Actually, McD's HAD been in a slump, but they have been very successful in turning their business around in the last couple of years.

A quick review of their annual income statement (http://finance.yahoo.com/q/is?s=MC&annual) shows a steady increase over the last three years.

FYE 31-Mar-07: $1,846,073
FYE 31-Mar-06: $1,312,485
FYE 31-Mar-05: $543,873

[Kevy Baby]

It sounds like they are going to have automatic espresso machines. Push the button and you get a fancy drink.Isn't that what Starbucks is doing now? I thought I remembered seeing someone posting something along those lines here.

[blueerica]

Actually, McD's HAD been in a slump, but they have been very successful in turning their business around in the last couple of years.

A quick review of their annual income statement (http://finance.yahoo.com/q/is?s=MC&annual) shows a steady increase over the last three years.
FYE 31-Mar-07: $1,846,073
FYE 31-Mar-06: $1,312,485
FYE 31-Mar-05: $543,873

That does seem like it would be about right. I did the case study in '06, and haven't kept up on the numbers of how they're doing.

Isn't that what Starbucks is doing now? I thought I remembered seeing someone posting something along those lines here.

Technically, yes, since their machines are set up so that the shot timing is automatic. I was guessing she meant something that's just a step above those little gas station-convenience store machines that at a press of a button makes you a drink.

Just so long as the place doesn't end up smelling as vile as Starbucks/Peets/etc.

I'm trying to think of what the vile smell might be, but perhaps you just don't like coffee? To me, unless I'm craving over-salted french fries (which I crave from time-to-PMSy-time), McDonald's already smells pretty greasy and vile. I can't imagine coffee would smell very good with that.

Bleh.

[Alex]

Yes, it is the coffee smell that most people love that I loathe. On the other hand it gives me cantankerous joy when dragged along behind Lani to walk through a Starbucks/Peets/etc. commenting under my breath (but just loud enough) about how the place reeks.

It is only slightly better than a Body Shop store and almost as bad as walking through the cosmetics section of a Macy*s.

I can't honestly say that I find the greasy smell of a McDonald's all that great but it is magnitudes better (to me) than the smell of coffee. I don't eat a lot of McDonald's except when on the road but if they started to smell like coffee shops it would be a huge incentive for me to go elsewhere.

[Capt Jack]

McD and I parted ways eons ago. coffee or no, I dont see myself changing that.

[Kevy Baby]

I do have say that the current coffee (that McD's switched to a couple of years ago), is actually not too bad.

[blueerica]

I'm with Kevy... and as a coffee lover, I was pleasantly surprised that it was pretty good (plain, black) coffee that I got there. I still don't think I'm going there for lattes any time soon.

[lindyhop]

I was surprised that this wasn't in all McDonald's already. There's a McD across from my morning Starbucks that's been pushing lattes for quite a while. And no, they're not self-serve.

[lashbear]

Quite a few of ours here have "McCafe's" and have for many years, but I've never had coffee there, I prefer a cafe that was opened as a cafe, not as an adjunct to a burger store.

[Stan4dSteph]

Quite a few of ours here have "McCafe's" and have for many years, but I've never had coffee there, I prefer a cafe that was opened as a cafe, not as an adjunct to a burger store.Very true. I much prefer Robert Harris (http://www.robertharris.co.nz/), but it's a nice alternative if you have a family group or a toddler who has cabin fever and needs to burn off some energy at the McD Playland.

[Sohrshah]

I can't see myself becoming a McDonald's coffee devotee.

I pay $4 for my coffee, and $3.50 for my Big Mac.... I expect damn good coffee, if you KWIM. If they try to serve me a Big Mac latte, they'd better have a price point under $2.

That's a good point. McDonald's cannotexpect the public to pay as much for their latte's as they do for a Starbuck;s latte. McDonald's is still a fast food joint. Starbucks has always been a few grades above that in their presentation.

I don't yet know how to quote more than one person's statement in one response, but Alex mentioned that he won't like the smell. McDonald's has always had coffee, so if you can stand it now, I doubt the smell with change very much if they have more coffee. It that's any consolation.

I was aware that McD's was in a bit of a slump, and I'd noticed that they were finally doing the logical thing- just being a burger joint. I think a good part of their problem what that they were overextending. McD's makes Big Macs. Stick with that, you know?

That said, I'm actually doing research to see which road food joints have the healthiest food (for my cross country drive), and I doubt Mcdonald's will be high on the list, so there's that, too.

[Alex]

On the other hand, unlike McDonald's the coffee isn't the main thing so they don't have to derive all their profit from it. They don't have to build stores and pay the rent off of coffee sales. Their overhead in expanding into coffee is much smaller than Starbucks so I've no doubt that they could sell coffee at fractions of the Starbucks' price and it would still be a fair profit. And if they are able to even approach Starbucks pricing it'll be easy money.

[Sohrshah]

On the other hand, unlike McDonald's the coffee isn't the main thing so they don't have to derive all their profit from it. They don't have to build stores and pay the rent off of coffee sales. Their overhead in expanding into coffee is much smaller than Starbucks so I've no doubt that they could sell coffee at fractions of the Starbucks' price and it would still be a fair profit. And if they are able to even approach Starbucks pricing it'll be easy money.


That's a very good point!

[Morrigoon]

:OT:
Use the button that looks like "+ you click that button on all the posts you want to quote. When you've got them, just hit "quote" on one of the posts and it'll pull them all up for you.

And now back to your regularly scheduled coffee discussion:

You make a good point, Alex. I could see the appeal of enjoying a latte while letting my kid (if I had one) run around the playplace. After all, noisy kids don't exactly fit the "sophisticated" profile of a Starbucks or Peets.

[Sohrshah]

:OT:
Use the button that looks like "+ you click that button on all the posts you want to quote. When you've got them, just hit "quote" on one of the posts and it'll pull them all up for you.

And now back to your regularly scheduled coffee discussion:

You make a good point, Alex. I could see the appeal of enjoying a latte while letting my kid (if I had one) run around the playplace. After all, noisy kids don't exactly fit the "sophisticated" profile of a Starbucks or Peets.

Thanks, Goonie! I think I've got it now!

It might be nice to give parents more opportunities to make the "right" choices about bringing their children to appropriate venues- I have sipped my coffe next to a toddler more than once at a Starbucks.

[Kevy Baby]

On the other hand, unlike McDonald's the coffee isn't the main thing so they don't have to derive all their profit from it. They don't have to build stores and pay the rent off of coffee sales. Their overhead in expanding into coffee is much smaller than Starbucks so I've no doubt that they could sell coffee at fractions of the Starbucks' price and it would still be a fair profit. And if they are able to even approach Starbucks pricing it'll be easy money.A very large part of the Starbucks business model is the "experience" that they try to create within their stores. The initial concept of Starbucks was to recreate the social gathering spot experienced in France (at least I think it was France).

On a related topic, Starbucks announced today (http://www.starbucks.com/) that Howard Schultz would be taking back over the reins of the company.

[Alex]

Yes, and?

I'm not saying Starbucks doesn't offer a different experience. Just that because Starbucks charges $4 for a cup of coffee doesn't mean that McDonald's needs to, to get the same profit.

Of course, I think they should just merge so the stores are always next to each other. The breakfast food Starbucks sells is pretty horrible (except the granola cups) so even an egg mcmuffin is preferable. Of course, then the McDonald's would definitely smell like a Starbucks. I just can't win unless everybody stops drinking coffee.

[Strangler Lewis]

Thanks, Goonie! I think I've got it now!

It might be nice to give parents more opportunities to make the "right" choices about bringing their children to appropriate venues- I have sipped my coffe next to a toddler more than once at a Starbucks.

On the level of distraction at cafes, I think children come in a distant third to 1) cell phone yellers and 2) the volume of music that the counter staff puts on.

[Chernabog]

A very large part of the Starbucks business model is the "experience" that they try to create within their stores. The initial concept of Starbucks was to recreate the social gathering spot experienced in France (at least I think it was France).

It's Italy, but you're on the right continent ;)

Starbucks to me has gone somewhat downhill. When I worked for them, there was a LOT more customer interaction than there is now (especially on the drink making side, when we actually grinded, tamped down, and timed our shots. Now there's this giant metallic object -- the shot-maker-- blocking you from seeing what the heck the barista is doing). Also, Starbucks used to have in-store ceramic cups. Having everything now in "to go" cups detracts from the experience IMO.

And yes, some Starbucks do smell bad. It is something they need to work on, and I think it has to do with the current food-heating of items... BAD idea for rubbery tasteless yuck. Or that they just don't clean the milk off the floors as thoroughly as they should.

The only time I eat at a McDonalds is when I am on a road trip up the 5. I wonder how they're going to do fast food lattes though, considering an actual human still needs to be there to steam the milk, and you can't have hot milk just sitting out there for a long time. Perhaps they just heat milk in a microwave? (which doesn't make a real latte).

[Strangler Lewis]

I assumed they'd use the same gleaming push button machine found at the finest gas stations.

[Tref]

I'm against it!

I am a tea man myself, though if they do a soy latte, I will have to check it out.

[CoasterMatt]

Any toddler near me at Starbucks is having whiskey added to their coffee.